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The iShares MSCI Belgium ETF (EWK) completed its flag formation on April 29 as it closed above the resistance, line c.
- This completed the flag formation (lines c and d) with
initial upside targets in the $15.10-$15.30 area.
- The high in 2011 is at $15.65, which is the next
- Initial support in the $14.70 area with the breakout
in the $14.50 area.
- The daily on-balance volume (OBV) (not shown) has confirmed the
The iShares MSCI United Kingdom (EWU) gapped through resistance at line e, on April 25.
- This completed the recent trading range (lines e and
f) that goes back to the early February highs.
- There is next resistance at $19.18 with upside targets
from the charts in the $19.50-70.
- The May 2008 high was at $23.61 with an all-time high
of $27.38 in October of 2007.
- EWU triggered a daily HCD
on April 22.
The iShares MSCI Mexico Investable (EWW) hit a high of $76.80 and then dropped to a low of $70.88 on May 1. This was a drop of 7.7% from the highs.
- The close Tuesday was just above the quarterly pivot
- A breakout to new highs would complete the four-month
trading range and give upside targets in the $83-$84 area.
- The relative performance did not confirm the recent highs, line c, and is still below
- The daily OBV broke through its short-term downtrend,
line d, and is acting much stronger than prices.
- The OBV has longer-term support at line e.
- There is initial support at $72.60-$73.45 with
stronger at $70.88.
What it Means: The
increased number of global ETFs and higher liquidity have made the global stock
markets an important part of one's portfolio as most are not well diversified.
Certainly, following the German Dax over the past year or so was a good guide in determining where the US markets were likely headed.
I am continuing to look for a pullback in some of the overseas ETFs for new buying opportunities but (EWW) looks good now.
How to Profit: For the iShares MSCI Mexico Investable (EWW), go 50% long at $73.42 and 50% long at $72.84, with a stop at $69.83 (risk of approx. 4.5%).